Allstate alleges fraud at Valley chiropractic clinics

McALLEN - One of the nation's top insurers has sued a group of Rio Grande Valley chiropractic clinics and lawyers over their alleged involvement in a multimillion-dollar fraud ring.

In a federal lawsuit filed in Dallas, Allstate Insurance Co. accuses Arlington-based Chiropractic Strategies Group Inc. and its associated clinics of soliciting patients, encouraging them to undergo unnecessary treatments and then persuading them to file personal injury lawsuits against the insurance company.

The Valley clinics are part of a larger network with branches across Texas, Ohio, Indiana and Alabama, Allstate spokesman Bill Mellander said.

"This is one of the largest insurance fraud investigations that Allstate has ever undertaken," he said. "The investigation is exhaustive because it has to be right."

According to a 67-page complaint filed in the case, Chiropractic Strategies clinics targeted hundreds of potential patients by combing through vehicle accident reports at local police stations.

Telemarketers then encouraged the parties to visit company clinics for free evaluations, where chiropractors - and sometimes unlicensed assistants - diagnosed them with injuries ranging from spinal problems to bone misalignments.

In many cases, the extent of the injury was exaggerated and the treatments unnecessary, the insurance company alleges. But once treatment was completed, patients were referred to a law firm for potential personal injury lawsuits.

Allstate estimates Chiropractic Strategies and associated businesses are responsible fore more than $10 million in fraudulent payments over the past six years.

"Individuals who conduct fraud generally do so because they think that they are digging into the deep pockets of a big insurance company," Mellander said. "But the reality is they're not. They're stealing from you and me."

Past Legal Problems

Although Chiropractic Strategies operates clinics across the country, the Valley has quickly become a hub of operations, Mellander said.

The company has managed five past and current facilities here including Dove Pointe Chiropractic in McAllen and Weslaco Chiropractic on South Texas Boulevard. Training sessions for new chiropractors are also held here.

And three lawyers the suit names as defendants - and who allegedly accepted case referrals from the clinic - reside in South Texas.

One of them - Eugene X. Mercier - has an extensive history of disciplinary reprimands from the State Bar of Texas.

He also has been convicted of theft and conspiracy to commit barratry - a third-degree felony charge aimed at lawyers who solicit clients rather than waiting for them to come forward on their own.

Mercier, a Corpus Christi-based personal injury attorney who once operated offices in McAllen, Harlingen and Brownsville, was convicted by a Hidalgo County jury in April 2002 and disbarred. Chiropractic Strategies owner Michael Kent Plambeck was also indicted in the case but charges against him were later dropped.

But even after Mercier lost his license, he has allegedly continued to operate law offices through a licensed figurehead who accepts Chiropractic Strategies referrals, according to Allstate's lawsuit.

Case So Far

Several phone calls to a Chiropractic Strategies spokeswoman, who is also named in the suit, went unreturned and attempts to locate company officials at local clinics were unsuccessful.

So far, no attorneys have filed with the court to represent Mercier, Plambeck, Chiropractic Strategies or any of its Valley clinics.

However, a former law office manager for Edinburg lawyer Rodney Sipes has denied allegations that he ran an office that participated in the alleged fraud ring.

Several of the allegations in the lawsuit - such as barratry and insurance fraud - are criminal acts, but Mellander said he was unaware if law enforcement agencies are currently pursuing charges against any of the 66 defendants.

"If authorities come to us and ask us to see the information we have, we'd be glad to share it," he said.

The Texas Attorney General's Office would not comment on any possible ongoing investigations into the Chiropractic Strategies network.

No hearing date has been set for Allstate's case.